Wednesday, September 30, 2015

Tenant Advisory: Don’t Get Distracted by Mediation, Demand Rent Control

by Kimberly Craige and Dan Harper, TT Organizers

With California residents demanding rent control and just cause for eviction to stop rising rents and displacement in their cities, landlords, realtors, and politicians tied to the industry have suggested a few distracting alternatives to being regulated under rent control. Most of these alternatives were created by the real estate and landlord industries themselves and have no teeth. The first alternative is the California Apartment Association’s “guideline” discouraging landlords from raising the rent more than 10%, and the second is implementing a Rent Review Mediation or Review Board. However, when comparing the impact that implementing modern Rent Control versus implementing a Rent Review Board, it is clear that Rent Control is still the only option if the goal is to prevent displacement and stop rent-gouging.

Local CAA mailer to landlords

Encouraging landlords to "be sensitive"

Throughout the state, we’ve seen that voluntary models of compliance of industry regulations do not work. The regulated cannot regulate themselves. We can’t trust Chevron to voluntarily regulate its refineries nor the natural gas industry to regulate fracking. Rent Mediation Boards in CA typically don’t have any teeth and decisions are merely advisory. It’s like company management going to the negotiating table with Union members and saying, “Hey we’ve got this great idea, we are going to change your contract so we can fire you at any time without a reason but trust us we won’t do that, and by the way we are going to give you raises every year based on CPI/inflation but we can’t guarantee that in writing.” No union worth a damn would accept that so why should tenants accept that for their housing!? It’s not that much to ask of city going through the greatest housing crisis in its history to enact modest renter protections that ask landlords to cite a reason for tenants being evicted and limit the amount rent can be raised yearly (based on local CPI/inflation). This is not your grandpa’s NYC-style rent ceilings. Modern rent control is moderate regulation for an industry that has no rent regulation whatsoever in most California cities.

Several cities currently have rent mediation boards and there is a lot of evidence that they don’t work. The City of Fremont’s Residential Rent Increase Dispute Resolution Program (RRIDRO) Summary (March 2012 to March 2015) received 932 tenant calls about unreasonable rent increases and only 19 tenants had any rent reduction at all, that’s 19/932! From January to March of 2015 9 tenants used the RRIDRO program and not one has had their rent reduced. The city of San Leandro has a Rent Review Program that kicks in if a tenant gets a rent increase of 10% or more which is about $75.00 per month. According to San Leandro’s Annual Rent Review Program Evaluation (July 2013 – June 2014) there were thirty-seven (37) tenant inquiries 2 of these cases went before the rent board one was resolved and the other was resolved before it came to the board. Even if a tenant goes through the process the landlord can do what they want at the end. San Leandro City staff has inferred that in 2015 many more tenants are calling in.

Throughout the country rent control has proven to keep tenants in their homes, and has allowed them to pay rent that is affordable. California cities should not waste time and tax payer money on a rent mediation program that has a failed track of not keeping rents down and not keeping tenants in their homes. Mediation can serve a purpose in many contexts, but not in regulating rents. Mediation requires both parties to come to the table in good faith to resolve a dispute—raising the rent is a business decision for landlords, not a dispute that needs to be mediated.

Instead, passing rent control will allow more tenants to afford their home, and just cause for eviction will allow tenants a fair chance at keeping it. The census shows us that 16.5 million Californians are renters. While not the only tool, rent control and just cause for eviction are important to preserving the many diverse communities in CA.

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